Corporate Compliance Requirements: What are the prerequisites for establishing a business in Thailand?

1. Name of the company
The company name must be reserved with the Ministry of Commerce’s Department of Business Development (DBD).

Even though the business name is in English, it must conclude with the term Limited and be registered in Thai. Once authorized, the name will be valid for 30 days with no possibility of extension.

2. Director(s)
A Thai corporation must have at least one director who is over the age of 20, a Thai resident or non-resident, and is neither incompetent or insolvent.

3. Shareholder(s)
In Thailand, companies must have a minimum of three shareholders. Under some conditions, foreign investors can get 100 percent ownership.
Foreigners can own up to 49 percent of activities allocated for Thai citizens.

4. Association Memorandum
The Memorandum of Association (MOA) is a legal document created during the registration procedure by the company’s founders.

The MOA should include the following information:

➤ Limited liability corporation
➤ Name of the company
➤The company's goal
➤ Capital registered
➤ Name, residence, age, employment, and the amount of shares reserved for purchase by the company's founders
➤ Two witnesses' names, addresses, and ages
➤ Limited liability corporation
➤ Capital registered

5. Company name display
The firm name must be visible at the workplace. The company’s name must be displayed on papers such as invoices, letterheads, and receipts, along with the words Company Limited or Limited.

6. Registration address
Companies in Thailand must have a registered location in order to receive paperwork from government officials. It can be any genuine street address where the owner or legal renter has granted the firm permission to use the site as the registered address.

Companies who do not have a physical location might benefit from virtual office spaces or fitted desk space solutions.

What are the corporate compliance requirements for Thai companies?

1. Shareholders’ general meeting
The initial general meeting of the company is held within six months after incorporation, and subsequent general meetings are held once a year.

2. Annual statements
At the conclusion of each accounting period, private and public limited firms must present the following documents:

➤ Accounts that have been audited
➤ The balance sheet
➤Account of Profit and Loss Company Name
➤ Details about the director
➤ Shareholders' List
➤ The annual meeting's minutes
➤ Business type
Corporate compliance requirements in Thailand

Accounting and tax's Corporate Compliance requirements for Thai businesses

1. Date of the fiscal year's conclusion

Companies in Thailand complete their fiscal year on December 31. The accounting term is 12 months, although for newly created firms, the accounting period might be fewer than 12 months.

2. Requirements for bookkeeping

Company accounts and other related papers must be preserved at the company’s registered location for at least five years from the date of closing their account, although the Revenue Department may extend this to seven years based on the company’s commercial activities.

The following documents, records, and statements must be kept:

➤ Journal of Accountancy
➤ Accounts statement
➤Payment and receipt records
➤ Statements of profit and loss
➤ Financial statements
➤ Electronic money transfer records
➤ Transactions involving credit cards
➤ Bank statements, including check stubs
➤ Audit reports, whether internal or external
➤ Financial statements, accounts, and papers must also be documented in Thai or in a foreign language with Thai translation, written in ink, typewritten, or printed

3. Financial statement audit

At the conclusion of the fiscal year, businesses must prepare audited and certified financial statements. As the audit opinion is necessary when filing financial statements and tax returns, the auditor must also provide their view on the financial statement.

4. Return of Corporate Income

Companies are required to file corporation tax returns (Form CIT 50) and pay taxes within 150 days of the end of their fiscal periods.

Companies that solely dispose of funds/profits from Thailand must also pay corporate income tax and file Form CIT 54 within seven days of the disposal date.

What are the Thailand's labor laws?

1. Annual vacation
Employees who have worked for one year in a row are entitled to at least six working days of yearly leave.

The employer and employee might agree to carry forward any unused annual leave from the previous year to the next year.

2. Illness leave
Every year, employees are entitled to 30 days of sick leave. If an employee takes more than three days of sick leave, they must provide the employer with a medical certificate.

3. Motherhood leave
Pregnant female employees are entitled to 98 paid days of maternity leave, which includes prenatal appointment days.

4. Parental Leave
Employees in the public sector are the only ones who are entitled to 15 days of paid paternity leave.

5. Social Security Trust Fund
Thailand’s social security system covers the following people:

➤ Section 33 - an employee who is under the age of 15 and not over the age of 60
➤ Section 39 - an employee who is an insured person under section 33 and has paid contributions for at least 12 months but ceases to be an insured person by ceasing to be an employee
➤Section 40 - any other individual who is not an employee as defined in sections 33 or 39. The percentage of social security contribution is 5%

THB 1,650 is the lowest wage for calculating social security contributions, while THB 15,000 is the maximum (THB 83 and THB 750).

Social security contributions must be remitted to the Social Security Administration by the 15th of the month following.

Establish your company in Thailand

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